Chevron cuts 2016 budget by a quarter to $26.6 billion


SAN RAMON, California -- Chevron Corporation has announced a $26.6-billion capital and exploratory investment program for 2016. The 2016 budget, which includes $4.5 billion of planned expenditures by affiliates, is 24% lower than total expected investments for 2015.

Chevron has set its total upstream spend at $24 billion, with $5.4 billion earmarked for the U.S. and $18.6 billion set for international operations. 

For upstream, approximately $9 billion of planned capital spending is for existing base producing assets, which includes shale and tight resource investments. Roughly $11 billion is related to major capital projects currently underway, and approximately $3 billion relates to projects yet to be sanctioned. Global exploration funding accounts for approximately $1 billion.

"Our capital budget will enable us to complete and ramp-up projects under construction, fund high return, short-cycle investments, preserve options for viable long-cycle projects, and ensure safe, reliable operations," said Chairman and CEO John Watson.

"We gain significant flexibility in our capital program as we complete projects under construction," Watson continued. "Given the near-term price outlook, we are exercising discretion in pacing projects that have not reached final investment decision."

Approximately 80% of affiliate expenditures are associated with investments by Tengizchevroil LLP in Kazakhstan and Chevron Phillips Chemical Company LLC (CPChem) in the U.S, Chevron said in a statement.

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